60. I would like to follow up Mr Keen's questioning.
I have to say that I was feeling pretty well-behaved today until
I heard this kind of fantasy land that Mr Dyke was leading us
into right at the end. He says that BBC1 and ITV are the two principal
channels and are liable to go on dominating. Each of them now
has got about 27 per cent of the audience, give or take the odd
percentage. Mr Dyke himself says that the BBC will settle down
with about 30 per cent of the audience, which may or may not be
so. Alan was talking about the change in the landscape. When the
predecessor to this Select Committee was conducting its inquiry
into the new Charter, which very much was framed in line with
the recommendations of that Select Committee, the lines of questioning
we have had this morning would never have occurred to most people.
We have moved exponentially into a new area in a very few years
and we are now on an exponential trend still further. You have
got three-eighths of the audience now on all your channels. Mr
Dyke, quite realistically, says 30 per cent. Your Charter expires
in under four and a half years. If you have got a third of the
audience by then you will be doing very well indeed. What I want
to know is how you can justify the continuation of the funding
of the BBC by a regressive tax on the basis of having 30 per cent
of the audience, if you get that?
(Mr Dyke) If you go backand I do not know if
I have got the sheet with mewe have done a sheet looking
from 1956 onwardsBBC1's share of the audience today is
roughly where it was in 1959, and the major change over the period
since then has been the decline of ITV's audience into other commercial
channels and some decline in the BBC's share in recent years.
You can look now at what is happening in digital homes. These
are people who have got 100 channels available to them and therefore
their viewing tells you something about what future share would
be. If you say how do we justify the BBC and what it does, I do
not think we should knock that around in the last five minutes
of this session. We would be very happy, if that is what you want,
to come back and give you the rationale of where the BBC is going
in future, what it supplies, what it does and what value it gives
to society. I do not think we want to do that in the last five
minutes of this session. That is a long debate. If you want to
do it, it is a very serious debate about the BBC's role in the
digital age. It is interesting and some of us would have different
views, but I would hate to get into that at this time.

61. That is all very nice, Mr Dyke, but the
fact is that we are living in a world that is changing in a manner
which few of us could foresee. We read in today's newspapers of
the way in which Premier League football is coming onto the computer,
for example. We are only at the beginning of convergence and yet
both you, and I have to say the Government, appear to believe
that the best future of the BBC is to preserve it in some kind
of aspic. What is your strategy? What I have never seen, and in
your document today I do not see it, is the strategy you have
for the convergence age to justify your being funded by a regressive
tax.
(Mr Davies) Can I just make a couple of comments,
Chairman. First of all, we are not preserved in aspic. We have
just launched a large number of digital channels. We are going
to launch more, the Government has given its permission. We introduced
one of Britain's leading web sites, if not the leading web site,
and we have been very active in that area. We are normally criticised
for doing too much rather than too little to change the structure
of the BBC and its channel content. I share with you a concern
that forecasting the future is very, very difficult at a time
of large technological change and I do not know how it will work
out, but the question that we have to ask ourselves (for a longer
term than the next Charter) is when these technical changes have
occurred, will people still feel that at maybe around 30 per cent
of their viewing they are getting value for money for £109
a year? It is very feasible that people will still consider that
that is very good value for money. If you compare what they are
paying for the BBC with what they are paying for subscription
channels, they are very much more expensive with much smaller
shares of viewing. As Greg says, if we look today at what we are
doing in the digital homes and the share the BBC is managing to
sustain, are those people still getting value for money for their
licence fees, and my answer to that at the moment is yes, but
I am not sure how it will change in future.

62. Mr Dyke is quite right to say that it is
inappropriate and unsuitable to enter into a large-scale debate
in the closing moments of your appearing before here, so I would
say two things: first of all, people who subscribe to the other
agencies which provide broadcasting do so voluntarily 
(Mr Davies) Absolutely.

63. Secondly, I put you on notice that it is
extremely likely before the end of this Parliament that we shall
be conducting an inquiry into the renewal of the Charter. Perhaps
we can all think more about how we will approach that, but no
doubt we shall be seeing you again before that.
(Mr Davies) I rarely think of anything else, Chairman,
so I am ready when you are!
(Mr Dyke) As a final line in a profound philosophical
debate, do not under-estimate the massive importance of universality.
The ability of everybody to receive is incredibly important. Secondly,
do analyse what is happening today in the commercial market-place.
The real problem of fragmentation is who pays for the original
programming in a decade's time if you are not funding the BBC,
because the great danger is that the world gets dominated by American
programmes.

Mr Bryant

64. 50 per cent of the BBC is not accessible
now.
(Mr Dyke) It will be universally accessible when Government,
not us, decides to switch off the analogue signal.

Chairman

65. My father in his last illness was encouraged
by our saying to him, "Look at the man next door, he is in
a wheelchair," and my father said, "I am sorry for him,
but it does not make me feel any better." The fact that ITV
is undoubtedly in a shambles is not some argument for saying that
all is well with you.
(Mr Dyke) It is not about the management of ITV or
anything else. It is what happens to advertising revenue in a
fragmented market-place; it fragments. That is what is happening
to ITV. The only response as a commercial organisation to that
is to reduce what you spend on programming; it is your only response.

Chairman: As you said, this is the start
of a new debate. Thank you very much.